Feds: Employers Can Pay Workers for Weight, Exercise

U.S. employers can reward workers with as much 30 percent of the cost of their health insurance benefits in return for participation in programs to monitor weight, cholesterol and other “wellness” measures, the Obama administration said Thursday.

Honeywell International Inc., for example, has given employees incentives worth as much as $3,500 to track health measures like body mass index and heart health.

Many other employers have similar programs, though there has been debate over how far they can go. While the Patient Protection and Affordable Care Act allowed employers to increase financial incentives for employee participation, the Equal Employment Opportunity Commission under President Barack Obama has sued companies, including Honeywell, arguing that they violated the Americans with Disabilities Act.

The proposed regulations issued today by the EEOC are intended to reconcile the two laws. The rule “makes clear that wellness programs are permitted under the ADA, but that they may not be used to discriminate based on disability,” the EEOC said in a statement.

While almost unheard of five years ago, more than a third of U.S. employers now charge their workers a penalty that averages about $50 a month if they don’t participate in wellness programs, according to benefits firm Towers Watson & Co. Some companies charge as much as $1,600 a year to employees who refuse.

Those penalties typically come in the form of higher health insurance costs. The average premium for a single worker at a U.S. employer was $6,025 in 2014, according to the Kaiser Family Foundation, a Menlo Park, California, nonprofit that researches health issues.

Cholesterol Screening

In Honeywell’s program, workers and their spouses have been asked to undergo screening that includes drawing blood to test cholesterol levels and a determination of body mass index by measurement of height, weight and circumference.

Holdouts were assessed a $500 surcharge on their 2015 health insurance plans, and could lose as much as $1,500 in company contributions to health savings accounts and be docked as much as $2,000 more in tobacco-related surcharges, according to the EEOC’s complaint.

It’s not clear how the EEOC’s proposed regulations will impact the lawsuits. A judge ruled Nov. 3 in Honeywell’s favor, denying the agency’s request to block the company from assessing penalties on workers who refused to participate.

Robert Ferris, a Honeywell spokesman, declined to comment.

Incentives

Under Thursday’s proposed rules, employers would not be allowed to threaten or otherwise coerce workers to participate, other than by using financial rewards and penalties. Companies couldn’t punish workers with disciplinary measures such as suspension or firing if they opt out.

Employers also wouldn’t have access to medical information about individual workers, only aggregated data about their entire workforce. Workers would have to be provided notices describing what information is collected in the wellness program, how it’s used and who sees it.

The agency said it will take public comments on its proposal until June 19, before issuing final regulations.

U.S. employers can reward workers with as much 30 percent of the cost of their health insurance benefits in return for participation in programs to monitor weight, cholesterol and other "wellness" measures, the Obama administration said Thursday.
Honeywell International...